SECTION 8 ALERT HR 5605 is the HUD Appropriations
Bill for the current fiscal year. It has been put forward by the House HUD Appropriations Committee
and will be taken up by the full Congress as soon as they reconvene in January. It proposes a whole
new formula for renewal funding for the Section 8 housing assistance program (aka the Housing Choice Voucher
program). If passed in its current form, it will lead to drastic cut backs in the number of households that
receive Section 8 housing assistance at a time when housing costs have truly become the big divide between
"the haves and the have-nots." Wages have simply not kept up with rising housing costs-and this is
particularly true for seniors and disabled persons on fixed incomes. Section 8 assistance has
proven time and time again to be the most effective tool our Nation has for closing the housing gap for the
poor as it marries low income households with privately owned rental housing at an affordable price.

As an example of the impact of the bill as written, the Santa Barbara City Housing
Authority will lose all funding for the 383 new vouchers that it received earlier this
year (just prior to the close of its FYE 3-31-02). These are Vouchers that it has
been actively placing under lease over the past few months. If passed as is, HR 5605
will drop their Section 8 program from 1,955 households being assisted to 1,572. A similar
scenario will occur for the Santa Barbara County Housing Authority. Nationally, the
cut back will translate to 125,000 fewer families receiving assistance. If you are
concerned about funding of Section 8 housing you are urged you to contact members of
Congress about the problems HR 5605 will cause if adopted in its present form as it relates
to the number of folks that can be helped by the program. As Congress debates domestic
spending and the need to fund Homeland Security, housing programs for the poor tend to be
easy targets. An analysis of what HR 5605 does to Section 8 funding is provided in a
recent piece by the Center on Budget and Policy Priorities can be at
www.cbpp.org/10-9-02hous.htm .
If you have good contacts with members on the Republican side of the aisle, you might want
to urge them to consider this matter very carefully as it is NOT a good way to hold down
domestic spending in these tough economic times. Furthermore, it raises many doubts
about the future of a program that landlords. bankers, homebuilders, developers, and other
private sector firms and institutions have come to count on when entering and underwriting
the affordable rental housing market.

United Way of America has identified health care and affordable housing as the most serious problems for families in annual needs assessments over the past several years.

The U.S. government contends that no more than 30% of a family's household income should be used for total housing costs; more than 40% of American tenants are "rent burdened" using that criteria.

Affordable housing is scarce everywhere. A recent study in Bozeman, MT, a college town of 45,000 where 60% of the residents are renters, showed that almost 40% pay more than 35% of there income in rent. Even though the rental housing stock is generally old and poorly maintained.

There are about 33.4 million renter households and HUD research has determined that 47% had incomes low enough to be eligible for housing

More than four million households reside in HUD-assisted rental units in the U.S., representing 12% of total renters and 26% of income eligible renters.

Of the total assisted households, approximately 1.1 million live in public housing units, 1.4 million receive assistance through housing vouchers or Section 8 certificates, and 1.6 million live in private, project-based units under various other HUD subsidy programs and low-income housing tax credits.

According to HUD's 2000 worst case housing needs report, "Rental Housing Assistance * The Crisis Continues ", there are at least 5. 4 million households that pay more than half of their incomes for rent and/or live in severely substandard homes.

A one-bedroom apartment is cheaper in Arkansas than in any other state. Yet even there the income from a minimum-wage job is too little to afford a roof over a family's head .

The National Low Income Housing Coalition (NLIHC) found, in a report, named "Out of Reach The Growing Gap Between Housing Costs and Income of Poor People in the United States," that a full-time minimum-wage worker cannot afford to pay the fair market rent for a two-bedroom unit anywhere in America. See: New Stuff

The average U.S. worker must earn at least $ 11.28 an hour to afford the rent on a modest one-bedroom apartmentor $13.87 an hour for two bed-rooms, according to the annual "Out of Reach" report by the National Low Income Housing Coalition, released recently. That's less than the nation's $16.97-an-hour median paycheck in 2000, according to the Bureau of Labor Statistics. But it is far more than the minimum wage, set by federal law at $5.15 an hour but slightly higher in 10 states and the District of Columbia. About 2.7 million Americans last year worked for the hourly minimum wage - about 2 percent of all workers, not counting those with annual salaries at the same level.

However, the affordable housing crises is not national; it's local.

Municipalities practice exclusionary zoning that prevents inexpensive multifamily housing from being built. Local governments initiate strict building-code enforcement campaigns that result in closing single-room occupancy hotels and other cheap housing in inner cities. They now impose costly rental inspections with sometimes subjective interpretation of requirements and inspectors who insist on impossibly expensive up-dating of century old housing.
Then, as government imposed costs cause rents to rise, the short-sighted but politically popular response has often been rent control -- now proven to be the surest way to eliminate rental housing construction and renovation, and guaranteed to produce an affordable housing crisis.

Government has been involved in various attempts at providing affordable housing assistance to low-income families in the US since the collapse of the banking system in 1929 led to a national housing crises.

Project based rent subsidy programs were government's first attempt at providing affordable housing to low-income tenants.

Section 8 rent subsidies , in the form of vouchers and certificates, empower tenants to find affordable housing in the general population of their community, rather than confining them to "projects." The HUD paid program assumes that no one should be required to pay more than 30% of their household income for housing costs.

Section 8 changes mandated by the Republican Congress are affecting the entire rental housing market. Congress has forced HUD to cut or change many programs to lower costs.

Public Housing: Legislation first passed during the great depression was intended primarily as jobs programs, to construct government owned public rental housing in major cities. The act was modified and expanded as the Housing Act of 1937 and provided for the establishment, through state law, of local Public Housing Authorities (PHAs) to build, own, and operate the housing.